Gazprom ups 2013 Europe gas export forecast

Gazprom hopes to increase supplies to Europe, as its main competitors redirect their deliveries to the “premium” markets of the Asia-Pacific Region. Source: AP

Gazprom, Russia’s natural gas monopoly, has revised its 2013 Europe gas export forecast upwards by 10 percent, to more than 160 billion cubic meters, and announced plans to triple its share on the LNG market to 15 percent.

Gazprom plans to
export to Europe more than 160 bcm (5.6 trillion cubic feet) of natural gas in
2013, Gazprom CEO Alexey Miller told the Annual General Meeting on Friday, June 28.

According to him, Gazprom sold 139.9 bcm
of natural gas to European consumers in 2012 (see the chart) under long-term
contracts, while total sales amounted to 151 bcm.

Back in February, Gazprom’s
forecast was a moderate one, projecting growth to 152 bcm this year.

It would be a bit
too optimistic to hope for an increase in the monopoly’s market share in Europe
based on the forecast for Turkey alone, warns Mikhail Korchemkin, director of
East European Gas Analysis.

Gazprom has also
reported progress in its talks with German buyers. It took the gas giant a year
to resolve the conflict with RWE. The two companies had negotiated discounts
for about a year, but they managed to settle only in court.

Last week, an
international court of arbitration ruled that Gazprom had to pay the German
company the price difference accumulated since May 2010. Neither company has
commented on the court decision or the size of the payment.

A source close to
Gazprom says the monopoly will have to pay €1.5 billion ($1.9 billion) by the
end of the year. Alexander Medvedev, deputy CEO of Gazprom, told Vedomosti that
the company would comply with the ruling.

Furthermore, Gazprom will soon announce
completion of talks over price adjustment with some other European importers,
Medvedev promised the shareholders.

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“It is the APR [Asia-Pacific Region] that is projected to have the
fastest-growing demand for LNG, and it is that region that will be the focus of
our expansion of our export markets. We will boost our presence in the APR
primarily through an increase in our own production,” Miller said.